Alaskan Village, Inc. v. Smalley, for and on Behalf of Smalley, S-928

Citation720 P.2d 945
Decision Date13 June 1986
Docket NumberNo. S-928,S-928
PartiesThe ALASKAN VILLAGE, INC., Appellant, v. Mary SMALLEY, for and on Behalf of Monica SMALLEY, an infant, Appellee.
CourtSupreme Court of Alaska (US)

Paul W. Waggoner, Paul W. Waggoner, Inc., Anchorage, for appellant.

L. Ames Luce, Jeri D. Byers, Law Offices of L. Ames Luce, Anchorage, for appellee.

Before RABINOWITZ, C.J., and BURKE, MATTHEWS, COMPTON and MOORE, JJ.

OPINION

BURKE, Justice.

The primary issue in this appeal is the extent of a mobile home park owner's duty to protect others from injury from a tenant's dogs. The jury returned a verdict for Monica Smalley, who was injured by a tenant's dogs, holding the park owner liable for compensatory and punitive damages. The park owner appeals, claiming that it owed no duty of care to Smalley and challenging the damage award and several evidentiary rulings. We affirm.

I. FACTUAL AND PROCEDURAL BACKGROUND

Monica Smalley, a six-year-old child, and Henry Scepurek were neighboring tenants of The Alaskan Village, Inc. (Village), an Anchorage trailer park. Scepurek's rental agreement with Village includes a comprehensive set of rules and regulations. Paragraph 1 of these rules states that the tenancy is terminable on thirty-days notice. Paragraph 4 prohibits the tenant from keeping vicious dogs or more than one dog. Paragraph 23 states that a renter's failure to obey the rules is grounds to cancel the rental agreement.

When Scepurek moved in, he obtained a pet permit from Village allowing him to keep two chihuahuas. In the permit, Scepurek promised to remove the pets from the premises immediately upon notice that they annoyed other tenants.

At some point, subsequent to obtaining the permit, Scepurek acquired two Staffordshire terriers, commonly called pit bulls. On June 12, 1983, these dogs climbed out of their pen in Scepurek's yard, pulled Smalley from a swing set, and mauled her. She was severely bitten on her face, neck and arm.

Smalley sued Village for compensatory and punitive damages for their negligence. 1 Following trial, the jury returned a special verdict finding that Village's negligence was a proximate cause of Smalley's injury and that Smalley suffered $235,000 in compensatory damages. The jury also found that Village was guilty of reckless indifference to the safety of others and assessed $550,000 punitive damages. Judge Milton M. Souter entered final judgment against Village according to the special verdict. The court later amended its judgment due to errors in the original judgment. 2

Village appeals, arguing (1) it had no duty to protect Smalley, (2) punitive damages and past medical expenses should not have been awarded, and (3) the court erred in amending its original judgment. 3

II. VILLAGE'S DUTY TO PROTECT SMALLEY

Village argues that it had no duty to Smalley because the attack occurred in Scepurek's yard, an area over which Village had no control, and because Scepurek acquired the dogs after he moved in. Smalley contends that Village had a duty to use reasonable care to enforce its rules, and a duty to exercise reasonable care under these circumstances.

The Restatement (Second) of Torts § 323 (1965) imposes liability on a defendant that negligently performs an undertaking to render services:

One who undertakes, gratuitously or for consideration, to render services to another which he should recognize as necessary for the protection of the other's person or things, is subject to liability to the other for physical harm resulting from his failure to exercise reasonable care to perform his undertaking, if

(a) his failure to exercise such care increases the risk of such harm, or

(b) the harm is suffered because of the other's reliance upon the undertaking.

We have relied on this principle to establish a duty of care in a variety of factual situations. For example, a city which undertakes to provide police protection to its residents has a duty to exercise reasonable care in providing those services. City of Kotzebue v. McLean, 702 P.2d 1309, 1312-13 (Alaska 1985). Similarly, a defendant that voluntarily supplies a ladder for access between a tugboat and a dock is under a duty to exercise some degree of care toward those using the ladder. Williams v. Municipality of Anchorage, 633 P.2d 248, 251 (Alaska 1981). Finally, if the state voluntarily conducts building fire safety inspections, it must exercise reasonable care in conducting the inspection and abating known fire hazards. Adams v. State, 555 P.2d 235, 240-41 (Alaska 1976). However, evidence that the undertaking is for the plaintiff's benefit is a prerequisite to liability; a plaintiff who does not produce such evidence is not entitled to a jury instruction on this theory. McLinn v. Kodiak Electric Ass'n, 546 P.2d 1305, 1309 n.8 (Alaska 1976).

In City of Kotzebue v. McLean, 702 P.2d at 1313-15, we relied on the analytical factors adopted in D.S.W. v. Fairbanks North Star Borough School District, 628 P.2d 554 (Alaska 1981): (1) the foreseeability of harm to plaintiff, (2) the degree of certainty that plaintiff suffered injury, (3) the connection between defendant's conduct and plaintiff's injury, (4) the moral blame attached to defendant's conduct, (5) the policy of preventing future harm, (6) the burden on the defendant and consequences to the community of imposing the duty, and (7) the availability, cost and prevalence of insurance for the risk. Id. at 555. We consider these factors to determine whether an actionable duty of care exists under the particular circumstances.

Applying these principles to the instant case, we conclude that Village had a duty to exercise reasonable care to enforce its rules and regulations. (1) There was ample evidence that Village had actual knowledge of prior incidents involving Scepurek's dogs, and therefore it was clearly foreseeable that a person such as Smalley might be harmed; (2) Smalley suffered injury; (3) her injuries are closely related to Village's failure to take any action to enforce its rules; (4) Village's blatant disregard of its tenants' safety is morally blameworthy; (5) our policy is to encourage owners to enforce their rules to prevent harm to others lawfully on the premises; (6) the burden on owners of enforcing their own rules is not onerous; and (7) owners may obtain insurance or require tenants who own vicious animals to do so.

Village undertook to control pets on the trailer park premises by the lease provision prohibiting tenants from keeping vicious dogs and requiring Scepurek to immediately remove annoying pets. One of the trailer park managers agreed that he had "an obligation to enforce the rules ... concerning pets for the safety and well-being of the tenants in that park." [Tr. 465] Smalley was entitled to rely on Village to perform its duty.

The court instructed the jury that Village

is under a duty to exercise ordinary care in the enforcement of its rules and regulations providing for effective animal control in order to avoid exposing persons in the park to an unreasonable risk of harm. A failure to fulfull this duty, resulting in exposing persons to an unreasonable risk of harm, would be negligence.

This instruction is a correct statement of the law.

Given our conclusion that Village undertook the obligation to control vicious dogs in its trailer park, we do not reach Smalley's argument that a landlord has a more general duty of reasonable care under the circumstances presented here. See Uccello v. Laudenslayer, 118 Cal.Rptr. 741, 746-47, 44 Cal.App.3d 628, 118 Cal.Rptr. 741 (1975); Strunk v. Zoltanski, 62 N.Y.2d 572, 479 N.Y.S.2d 175, 176-178, 468 N.E.2d 13, 14-15 (1984); Palermo v. Nails, 334 Pa.Super. 544, 483 A.2d 871 (1984).

III. EXEMPLARY DAMAGES

Village argues that, even if compensatory damages were justified, it is not liable for punitive damages resulting from the conduct of others, it did not violate a clear duty, and the award was excessive. Smalley contends that the $550,000 award was justified. The court instructed the jury that it could assess punitive damages if it found Village guilty of reckless indifference.

A jury may award punitive damages if a defendant acts with reckless indifference to a plaintiff's safety; the purpose of punitive damages is to punish the wrongdoer and prevent similar conduct in the future. Sturm, Ruger & Co. v. Day, 594 P.2d 38, 46-48 (Alaska 1979), modified, 615 P.2d 621 (Alaska 1980), modified, 627 P.2d 204 (Alaska 1981), cert. denied, 454 U.S. 894, 102 S.Ct. 391, 70 L.Ed.2d 209 (1981), overruled on other grounds, Dura Corp. v. Harned, 703 P.2d 396, 405 n.5 (Alaska 1985). We will reverse the award only if we have a firm conviction based on the record as a whole that the trial court erred and we must intervene to prevent a miscarriage of justice. Id.

Village can be held liable for punitive damages based on the actions of its employees. The Oregon Supreme Court recently adopted the majority rule that if a tort by an employee renders the employer liable for compensatory damages and the employee's actions justify a punitive damage award, then the employer is liable for punitive damages, whether or not the employer authorized or ratified the tortious conduct. Stroud v. Denny's Restaurant, 271 Or. 430, 532 P.2d 790, 793 (1975). Under the reasoning of this rule, Village is liable for punitive damages if (1) the actions of its managers subject Village to liability for compensatory damages and (2) the managers acted with reckless indifference to Smalley's safety.

We conclude that the trial court correctly instructed the jury that the acts of Elaine Seegers, Curtis Johnson and Jean Bailey, the park managers, are attributable to Village as a matter of law, therefore their actions may subject Village to liability for compensatory damages. 4 The jury specifically found that Village acted with reckless indifference to the safety of others. Therefore, Village is liable for punitive damages under...

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